Pinto, JoãoPacheco, LuísAlves, PauloCunha, Ricardo2018-07-052018-07-052016Pinto, J., Pacheco, L., Alves, P., Cunha, R. (2016). How banks price loans in leveraged buy-outs: an empirical analysis of spreads determinants. Working papers: Economics. N.º 4, 47 p.http://hdl.handle.net/10400.14/25183This paper investigates which factors determine the pricing of loans in LBOs, using a worldwide sample of 12,673 syndicated loans closed during the 2000 - 2013 period . We find that spreads and pricing processes differ significantly in market - based versus bank - based financial systems as well as in the U.S. vis - à - vis W.E. In the pre - crisis period borrowers in market - based financial systems face higher spreads (33.59 bps) than those in bank - based financial systems and loans closed in common law countries are associated with higher spreads ( 50.71 bps ) than those closed in civil law countries . D uring the crisis period only loans in common law legal systems are associated with higher spreads . In line with Carey and Nini’s (2007) findings , w e show that U.S. borrowers face higher spread s than W.E. borrowers. We also find that the pric ing of loans in LBOs depends mainly on marketability and default factors and that acquired firms with a h igher cash flow potential and asset tangibility face lower spreads. Finally, a robust convex relationship between spread and maturity is found for loans in LBOs .engLoan pricingLBOsFinancial crisisTerm structure of credit spreadsworking paper